The Fixing America’s Surface Transportation (FAST) Act allows the IRS to notify the State Department with the names of those taxpayers certified as owing a seriously delinquent tax debt, which is currently $52,000 or more. Federal law, through the Internal Revenue Code § 7345, authorizes the Internal Revenue Service (IRS) to certify a taxpayer’s seriously delinquent tax debt to the State Department for the purposes of passport denial, limitation, or revocation.
While FAST requires the State Department to deny passport application or renewal of any taxpayer who has been certified, the IRS is not required to certify a tax debt as “seriously delinquent.” However, once a tax debt is certified, responsible taxpayers with a valid passport may have their passports revoked or their ability to travel outside the United States limited by the State Department.
A “seriously delinquent” tax debt is an assessed individual tax liability exceeding $50,000. In 2019, adjusted for inflation, this threshold amount is $52,000. Also, the IRS must have filed either a notice of federal tax lien or made a levy against the taxpayer.
Charles Rettig, the IRS Commissioner, granted a reprieve for certain certified taxpayers who may have been unable to use their passports. Effective July 25, 2019, all open Taxpayer Advocate Service cases with a certified taxpayer were decertified, and any new TAS taxpayer cases were systemically decertified.
However, this reprieve is only temporary. In August 2019, the Internal Revenue Service warned taxpayers to resolve their significant tax debts to avoid losing any use of their passports.
Taxpayers should contact the IRS as soon as possible to avoid any delays of their future travel plans. Because some resolutions take longer than others, there is some uncertainty so taxpayers should not delay. A tax attorney can help anyone in this situation and help prevent the loss of a passport.
The IRS also will not certify a taxpayer as owing a seriously delinquent tax debt or will reverse the certification for a taxpayer:
- in bankruptcy;
- identified by the IRS as a victim of tax-related identity theft;
- whose account has been determined by the IRS to be currently not collectible due to hardship;
- located within a federally declared disaster area;
- with a request pending with the IRS for an installment agreement;
- with a pending offer in compromise with the IRS; or
- with an IRS accepted adjustment that will satisfy the debt in full.
The IRS must send a decertification to the Department of State whenever a certification was made in error or where there is no longer a seriously delinquent tax debt. For taxpayers serving in a combat zone who owe a seriously delinquent tax debt, the IRS postpones notifying the State Department of the delinquency, so the taxpayer’s passport is not subject to denial during the time of service in a combat zone.
If you have received a notice of federal tax lien, IRS levy, or had a tax debt certified by the IRS as seriously delinquent, Contact a tax attorney at the Gartzman Law Firm at (770) 939-7710. We can help you with penalty relief and other tax resolution strategies. Use our simple contact form to arrange a free consultation today.